Correlation Between NeXGold Mining and Nicola Mining
Can any of the company-specific risk be diversified away by investing in both NeXGold Mining and Nicola Mining at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining NeXGold Mining and Nicola Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NeXGold Mining Corp and Nicola Mining, you can compare the effects of market volatilities on NeXGold Mining and Nicola Mining and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in NeXGold Mining with a short position of Nicola Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of NeXGold Mining and Nicola Mining.
Diversification Opportunities for NeXGold Mining and Nicola Mining
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between NeXGold and Nicola is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding NeXGold Mining Corp and Nicola Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nicola Mining and NeXGold Mining is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on NeXGold Mining Corp are associated (or correlated) with Nicola Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nicola Mining has no effect on the direction of NeXGold Mining i.e., NeXGold Mining and Nicola Mining go up and down completely randomly.
Pair Corralation between NeXGold Mining and Nicola Mining
Assuming the 90 days trading horizon NeXGold Mining Corp is expected to under-perform the Nicola Mining. But the stock apears to be less risky and, when comparing its historical volatility, NeXGold Mining Corp is 1.11 times less risky than Nicola Mining. The stock trades about -0.31 of its potential returns per unit of risk. The Nicola Mining is currently generating about -0.19 of returns per unit of risk over similar time horizon. If you would invest 31.00 in Nicola Mining on September 1, 2024 and sell it today you would lose (4.00) from holding Nicola Mining or give up 12.9% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
NeXGold Mining Corp vs. Nicola Mining
Performance |
| Timeline |
| NeXGold Mining Corp |
| Nicola Mining |
NeXGold Mining and Nicola Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NeXGold Mining and Nicola Mining
The main advantage of trading using opposite NeXGold Mining and Nicola Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NeXGold Mining position performs unexpectedly, Nicola Mining can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Nicola Mining will offset losses from the drop in Nicola Mining's long position.| NeXGold Mining vs. Faction Investment Group | NeXGold Mining vs. Gamehost | NeXGold Mining vs. Atrium Mortgage Investment | NeXGold Mining vs. 2028 Investment Grade |
| Nicola Mining vs. Kiplin Metals | Nicola Mining vs. Pure Energy Minerals | Nicola Mining vs. Noram Lithium Corp | Nicola Mining vs. Minnova Corp |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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